American International Group Inc (AIG) is likely to relaunch the sale of its Taiwanese unit, rather than utilizing other options, as Fubon Life Insurance confirmed yesterday it had been invited by the US insurance giant to join the bidding for Nan Shan Life Insurance Co (南山人壽).
The relaunch of the Nan Shan sale came after Taiwan’s regulatory authorities on Aug. 31 rejected a Hong Kong consortium’s application to acquire AIG’s Taiwan unit on concerns of the buyer’s financial strength and long-term commitment.
“We have been invited to bid for Nan Shan and we are in the process of preparing due diligence,” Fubon Life Insurance Co (富邦人壽) chairman Richard Tsai (蔡明興) said yesterday on the sidelines of a groundbreaking ceremony for a land development project in Taipei’s Xinyi District (信義).
PHOTO: CHEN MEI-YING, TAIPEI TIMES
The company is scheduled to conduct the due diligence investigation on Nan Shan next week and the potential bidding price will only be made known after that, Tsai said.
The Hong Kong consortium, comprising China Strategic Holdings Ltd (中策集團) and Primus Financial Holdings Ltd (博智金融), offered to buy AIG’s 97.57 percent stake in Nan Shan for US$2.15 billion in October last year. Tsai said on Nov. 10 in a business trip in China that the US$2.15 billion price was too high.
Fubon Life is a unit under Fubon Financial Holding Co (富邦金控), the nation’s second-largest financial services provider after Cathay Financial Holding Co (國泰金控). The company had reportedly offered to buy Nan Shan at a price of US$1.3 billion a year ago.
Besides Fubon and Cathay, another two Taiwanese groups — Chinatrust Financial Holding Co (中信金控) and a consortium led by Ruentex Group (潤泰集團) chairman Samuel Yin (尹衍樑) — have also been invited by AIG to bid for Nan Shan, the Chinese-language Commercial Times reported yesterday, citing people with knowledge of the deal.
The newspaper said that these four potential buyers would start the due diligence process tomorrow for the 40-year-old Nan Shan, which has a net worth of NT$140.3 billion (US$4.57 billion), accounting for one-third of the value of Taiwan’s life insurance market.
Chinatrust Financial president Daniel Wu (吳一揆) told an investor conference on Oct. 27 that the company remained interested in buying Nan Shan. Last year, the company had offered to buy Nan Shan at a price of between US$2.2 billion and US$2.35 billion.
Nan Shan has 4 million policyholders, approximately 4,000 employees and more than 34,000 agents in Taiwan. The company reported NT$12.58 billion in losses in the first three quarters and AIG had said it aimed to sell Nan Shan within 12 months.
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